Anyone clear my doubt...

Friends,

If a company has its regd. office and mfg plant in Chennai but sales office is in Mumbai.

I noticed them conducting separate VAT audit under Maharashtra VAT and TN VAT. Mumbai office is like Sales Dept and does not purchase any goods... they procure orders and pass Sales Orders... that's it...

this company has two TIN No's ...and complies with both VAT laws...

My question is how they apportion purchases & sales among both offices....

kindly explain the mechanism .... because this type of organisation structure has become normal nowadays...

thank you

expecting your answers...

Replies (4)
Place from where goofs moved is important.And next step would be to see as to why goods moved, is it pursuant to pre existing contract of sale or is it teansfer to depot simpliciter.Pls give more data

more data in the sense...?

I believe you are answering for a different question of mine... Sree Harsha

As per the VAT law, when the goods are despatched VAT needs to be collected.

Scenario 1

In your case Mumbai office get the orders and pass it on to Chennai

If Chennai office raises the invoice to customers, VAT will be collected and paid to TN vat authorities

When the goods are despatched from Chennai to Mumbai office and then invoice raised by mumbai office - in such cases, VAT needs to be collected and paid to Maharashtra vat dept

Also Mumbai office has to issue Form F to chennai office and chennai office has to submit those declaration forms to TN VAT authorities.

Scenario 2

If accounts are maintained together, there should be provision in the software which shows the transaction separately...

I hope this clear your doubts

 

Subramanya 

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